Unit 4 study guide(Business Essentials)

Money owed to the business is known as A)equity. B)assets. C)accounts payable. D)accounts receivable.

D)accounts receivable.

Marketing links producers to A)distributors. B)retailers. C)marketers. D)customers

D)customers

The money it takes to keep inventory in stock is called a __________ cost. A)holding B)stockout C)purchasing D)production

A)holding

A clothing manufacturer checks one pair of pants out of every shipment to ensure the quality of its product. This process is known as quality A)inspection. B)assurance. C)guarantee. D)delivery.

A)inspection.

Running out of inventory can result in A)lost sales. B)higher taxes. C)higher productivity. D)more satisfied customers.

A)lost sales

Without marketing, producers and customers would be A)in close communication with each other. B)highly dependent on advertising agencies. c)disconnected from each other. D)exposed to many new and improved products.

c)disconnected from each other.

What provides the basis for all marketing goals and actions? A)Pricing B) Planning C)Budgeting D)Retailing

B) Planning

Which of the following makes comparisons of the financial conditions at multiple organizations possible: A)Bookkeeping B)Source documents C)Accounting standards D)Trial balance

C)Accounting standards

Which of the following presents the first three steps in the accounting cycle in the correct order: A)Post, analyze, and journalize B)Analyze, post, and journalize C)Analyze, journalize, and post D)Post, journalize, and analyze

C)Analyze, journalize, and post

Which form of technology creates tangible prototypes and products? A)3D printing B)Smartphones C)Social media D)Computer-aided design

A)3D printing

Which of the following is a true statement about scheduling: A)Both manufacturers and service businesses rely on scheduling. B)Scheduling has the same timeline, regardless of the company. C)Many businesses do not need to use scheduling. D)Scheduling for business is the same thing as personal scheduling

A)Both manufacturers and service businesses rely on scheduling

The finance function is usually responsible for which of the following processes: A)Budgeting B)Manufacturing C)Operations D)Research

A)Budgeting

Of the following, which is a durable good: A)Coffee mug B)Insect repellent C)Hamburger D)Lip balm

A)Coffee mug

Which of the following influences the process of determining price: A)Customers' perception of value B)Publicity C)Purchase location D)Sales promotion

A)Customers' perception of value

An operations manager must determine the sequence materials will take through the production process. This activity is known as A)routing. B)scheduling. C)site selection. D)expense control.

A)routing

Which of the following categories of information are found on a balance sheet: A)Income, expenditures, profit B)Assets, liabilities, owner's equity C)Assets, liabilities, margin D)Revenues, expenses, profit

B)Assets, liabilities, owner's equity

In the marketing concept, whose point of view matters most? A)Seller's B)Buyer's C)Marketer's D)Planner's

B)Buyer's

Which of the following financial reports provides estimates of when, where, and how much money will come into and out of a business next year: A)Balance sheet B)Cash flow statement C)Income statement D)Bank statement

B)Cash flow statement

Which of the following activities is an aspect of marketing a service: A)Finding out customers' favorite coffee flavors B)Determining how much to charge for a haircut C)Offering a new, improved cell phone D)Advertising the state of Michigan on television

B)Determining how much to charge for a haircut

Which of the following is a requirement for a good accounting system: A)It should be updated annually. B)It should provide needed information quickly. C)It should eliminate the need for an accountant. D)It should be replaced every two or three years

B)It should provide needed information quickly.

Which of the following is an example of communicating with customers: A)Creating a new product B)Sponsoring a charity event C)Choosing a store to distribute products D)Developing a marketing plan

B)Sponsoring a charity event

Why are accurate accounting records important to a business? A)They prevent any financial losses. B)They show how the business is doing. C)They increase the return on investments. D)They give the business an image of success.

B)They show how the business is doing.

Decisions about financing refer to the A)accounts receivable. B)acquisition of funds. C)administration of assets. D)accounting department.

B)acquisition of funds.

The cash conversion cycle should be A)at equilibrium. B)as short as possible. C)as long as possible. D)on an upward trend.

B)as short as possible.

A bank denies a business owner's application for credit saying, "We feel that you would be unable to make the monthly payments because of your other debts." What financial report did the bank review? A)Budget B)Balance sheet C)Income statement D)Operating budget

B)balance sheet

To keep communication flowing with other departments, the finance function depends on A)accounts receivable. B)information systems. C)marketing. D)production.

B)information systems.

Finance is the business function that involves managing A)information. B)money. C)marketing. D)production.

B)money.

Which of the following is a key component of managing working capital: A)Financing B)Capital budgeting C)Cash conversion cycle D)Capital structure

C)Cash conversion cash

Which of the following is a marketing activity: A)Balancing customer needs with wants B)Leading a project team C)Communicating with customers D)Lowering operational expenses

C)Communicating with customers

According to the marketing concept, which option demonstrates customer orientation? A)Convincing a buyer to buy B)Researching a firm's competitors C)Finding out what a buyer wants D)Advertising the features of a produt

C)Finding out what a buyer wants

Which of the following items likely cannot be marketed: A)Holiday B)Health C)Hopefulness D)Hawaii

C)Hopefulness

Which of the following is a capital investment decision: A)How to manage cash flow B)How to handle accounts payable C)How to finance investments D)How to manage inventory

C)How to finance investments

What accounting record would summarize a business's profit or loss for a previous year? A)Bank statement B)inventory record C)Income statement D)Balance sheet

C)Income statement

According to the marketing concept, which option shows company commitment? A)Leaving marketing to the marketing department B)Teaching marketing to college marketing students C)Setting aside funds to research what customers want D)Pricing a product to maximize profitability per item

C)Setting aside funds to research what customers want

Money the business owes is known as A)equity. B)assets. C)accounts payable. D)accounts receivable

C)accounts payable.

A company's current balance of assets and liabilities falls under the focus of A)return on capital. B)working capital management. C)capital investment decisions. D)the cash conversion cycle

C)capital investment decisions.

The administration of assets refers to decisions about A)accounting. B)spending. C)investments. D)financing.

C)investments

The finance function would definitely be involved in a decision regarding A)public relations and publicity. B)personal selling. C)new business projects and strategies D)hiring.

C)new business projects and strategies

Checks, receipts, invoices, and purchase orders are examples of A)financial statements. B)department ledgers. C)source documents. D)accounting standards

C)source documents

What type of accounting method would most likely be used by a large business that has a large number of outstanding loans and customer charge accounts? A)Check method B)Cash method C)COD method D)Accrual method

D)Accrual method

Which of the following is a true statement: A)Bookkeeping is the same as accounting. B)Bookkeeping does not use computers. C)Bookkeeping is limited to information on sales. D)Bookkeeping records business transactions.

D)Bookkeeping records business transactions.

What type of accounting method would most likely be used by a small business owner who does not offer credit? A)Check method B)Accrual method C)COD method D)Cash method

D)Cash method

Which of the following is a measure of how well a business generates cash flow: A)Accounts receivable B)Capital structure C)Accounts payable D) Return on capital

D)Return on capital

Determining which projects a business should invest in is known as A)return on capital. B)the cash conversion cycle. C)capital structuring. D)capital budgeting.

D)capital budgeting.

The overall purpose of accounting is to A)maintain accurate reports. B)compile the business's expenses. C)keep track of sales. D)control the finances of the business.

D)control the finances of the business.

Riley is an employee of the federal government who studies the financial reports of majorbusinesses in a specific industry. The government's purpose in assigning this task to Riley is to A)determine creditworthiness. B)search for profitable investments. C)decide if funds are available for pay raises. D)identify trends in the industry.

D)identify trends in the industry

The finance function ensures that the company's financial goals are A)acceptable to the marketing department. B)related to product development. C)easy to accomplish. D)in line with organizational priorities.

D)in line with organizational priorities.

According to the marketing concept, keeping company goals in mind means A)making product prices low. B)containing marketing costs. C)putting marketing second to other company goals. D)maintaining the firm's purpose.

D)maintaining the firm's purpose.

The goals of the finance function are to ensure profitability and A)advertise products. B)manufacture raw materials. C)give out information. D)reduce risks.

D)reduce risks.

Accounting records for a business show that the week's total sales revenues were $125,000. Cash sales accounted for $50,000 and credit sales, $75,000. This is an example of A)classifying financial information. B)the cash accounting method. C)an income statement. D)the accrual method of accounting.

D)the accrual method of accounting.

Marketing encourages people from different countries to __________ frequently. A)travel B)train C)think D)trade

D)trade

Which of the following is the most common reason for businesses to search for ways to make their products better and cheaper: A)Competition B)Publicity C)E-commerce D)Service marketing

A)Competition

Which of the following is an example of one of a business's inputs: A)Employees B)Products C)Services D)Goods

A)Employees

How does the finance function relate to company spending? A)It plans and controls spending. B)It produces reports about spending. C)It spends on investments only. D)It does not relate to spending.

A)It plans and controls spending.

Deciding how to transport goods is part of which operations activity? A)Logistics B)Scheduling C)Safety and security D)Maintenance and repairs

A)Logistics

Which of the following groups makes regular use of a business's managerial accounting information: A)Managers B)Customers C)Creditors D)Investors

A)Managers

Which of the following is not a main factor in a business's site selection decision: A)Media B)Community C)Costs D)Labor

A)Media

Which of the following is a method used to communicate with customers: A)Personal selling B)Manufacturing C)Customer orientation D)Marketing concept

A)Personal selling

Two employees used a business's computerized accounting system to change some records. They were able to steal $50,000 from the business because the accounting system lacked which of the following: A)Protection from theft and fraud B)An affordable price C)A manual system as backup D)Printed financial statements

A)Protection from theft and fraud

Which operations activity is also referred to as procurement? A)Purchasing B)Inventory control C)Quality control D)Logistics

A)Purchasing

Complying with environmental laws is part of which operations activity? A)Safety and security B)Logistics C)Purchasing D)Inventory control

A)Safety and security

The process of keeping the financial records of a business is known as A)accounting. B)controlling. C)financing. D)bookkeeping.

A)accounting

For an accounting system to be useful to the business, the accounting information it contains must be A)accurate and up to date. B)approved by the chief executive officer. C)posted by an accountant. D)recorded using the accrual method.

A)accurate and up to date.

Operations managers must work closely with managers and employees in A)all other parts of the business. B)the marketing department only. C)competing businesses. D)foreign markets.

A)all other parts of the business.

A creditor is most likely to examine a business's financial accounting records if the business is A)applying for a bank loan. B)selecting a new market. C)using cash accounting. D)complying with regulations.

A)applying for a bank loan.

A clothing manufacturer builds quality into its operating system, placing responsibility on each employee. This process is known as quality A)assurance. B)inspection. C)guarantee. D)delivery

A)assurance.

Maintenance and repairs is an operations activity that includes A)custodial work. B)production planning. C)site selection. D)financial analysis.

A)custodial work

The operations function consists mainly of activities that are performed on a __________ basis. A)daily B)weekly C)monthly D)yearly

A)daily

Operations managers have two main goals in mind—efficiency (keeping costs low) and A)effectiveness (keeping customers satisfied). B)reputation (keeping up the business's good name). C)productivity (keeping business running fast). D)legality (keeping the business in good standing with the law).

A)effectiveness (keeping customers satisfied).

Selling shares in the company to raise money for a new venture is referred to as __________ funding. A)equity B)dividend C)debt D)accounts payable

A)equity

Marketing is described as creating A)exchanges. B)needs. C)advertisements. D)gaps.

A)exchanges.

When return on capital is positive, the company is A)growing in value. B)losing value. C)low on cash. D)paying out dividends.

A)growing in value

The difference between service providers' and manufacturers' operations activities is that service providers produce __________ outputs. A)intangible B)tangible C)expensive D)useful

A)intangible

Because operations managers control so much of a business's money, they must focus on A)keeping costs low. B)hiring the best employees. C)creating effective advertising campaigns. D)generating publicity.

A)keeping costs low.

Operations activities vary depending on a business's A)product. B)name. C)tax return. D)address.

A)product

The foundation of the operations function is A)production planning. B)maintenance and repairs. C)purchasing. D)quality control.

A)production planning.

Accounting is distinct from finance because its main focus is on A)recordkeeping activities. B)money management decisions. C)administration of assets. D)acquisition of funds.

A)recordkeeping activities.

Overall, what does marketing allow us to do? A)Stop buying online B)Live our daily lives C)Feel better about shopping D)Limit our spending

B)Live our daily lives

In an overall sense, where does marketing occur? A)Wherever advertisements are B)Wherever stores are C)Wherever businesses are D)Wherever customers are

D)Wherever customers are

The purpose of communicating with customers is to A)gather participants for a survey. B)befriend customers. C)determine prices. D)attract customers' interest.

D)attract customers' interest.